The market of communications services is always at the cutting edge

Said Deputy Head of FAS Anatoly Golomolzin discussing the antimonopoly policy in respect to the telecommunications’ markets and the Internet at the VIII Annual Conference on “Antimonopoly Regulation in Russia”

In the opinion of Anatoly Golomolzin, the telecommunications sector is the leader in transformations and implementing innovations on the markets of traditional services. At the same time, it is rapidly moving towards developing new services using the Internet; not only in the electronic services segment but also on other markets under the digital economy model. This is a new economic reality that is radically changing the nature of relations on the markets and the conditions for circulation of goods and services.

Thanks to developing competition between fixed and mobile communications, deregulation of fixed telephony has been on the agenda for already several years.  The issue can become pressing for other natural monopolies. Deregulation of competitive markets is also being discussed under the frame of the new tariff policy.

For about twenty years cellular companies have been demonstrating abilities to achieve large-scale growth and modernization of their technological infrastructure. The experience of those competitive markets is useful for discussing approaches to long-term tariff regulation that stimulates innovations.

The experience in joint use of infrastructure and frequency resources by cellular companies is also of interest since it encourages competition development on the market of end services.

The Rules for Non-Discriminatory Access to the communications infrastructure facilities of natural monopolies proved to be efficient. To ensure access of public at large to the services of modern communications companies, however, a new act was needed to give access to the common property of apartment blocks. That is why the agenda for telecommunications markets as well as other areas includes a broader question: access to essential facilities.

New, dynamically developing telecommunications and Internet markets required new approaches to the antimonopoly policy. For instance, establishing the basic Network Neutrality Principles, the Technological Neutrality Principles, the Fair Roaming Principles in cooperation between FAS, interested authorities and businesses enabled development of telecommunications and related markets and reduce the tariffs for the services on those markets.

Digital economy created unprecedented opportunities for market development, not only regarding e-services but a broadest range of markets. Taxi is called, air tickets purchased and tours are organized via the Internet. Distance selling via the Internet has blurred the lines between wholesale and retail markets, domestic and external trading. The objective is to form equal (non-discriminatory) conditions for operations on those markets.

Intellectual property rights for “digital platforms”, possessing and disposing of data become a way to achieve market power.

Market trends are no more shaped through bilateral relations built up on buying-and-selling or delivering. Business is monetized via complex chains of multilateral, multi-level interactions. It demands radically new approaches to market analysis and changes the methods of applying the antimonopoly law.

The Head of FAS Department for Regulating Telecommunications and Informational Technologies, Elena Zaeva, pointed out at the issues of market analysis and regulation under the conditions of economic digitalization. “Telecommunications markets are multilateral, where various groups of consumers and constantly cooperate with each other and profit is gained by obtaining income from “other sides of the market”, that simply exist due to supplies of the initial goods, rather than because of selling particular products. The difficulties of regulating such markets are in defining the product boundaries: the markets are mostly global while the national specifics of selling are manifested in the goods qualities”, explained Elena Zaeva.

Summing up, Anatoly Golomolzinstated: “The event participants learned a lot of new things in the traditional areas, and regarding digital economy it became clear what is the field for further joint efforts of antimonopoly officers, our colleagues from other bodies, business and the society. The time for making decisions in a dynamically changing market situation is quite limited. We must act promptly, coherently and purposefully”.